Shannon's measure of information is useful for characterizing the DNA and RNA patterns that define genetic control systems. It has been shown that binding sites on nucleic acids usually contain just about the amount of information needed for molecules to find the sites in the genome. This is a "working hypothesis" and exceptions can either destroy the hypothesis or reveal new phenomena. For this reason, we are actively studying several interesting anomalies. The first major anomaly was found at bacteriophage T7 promoters. These sequences conserve twice as much information as the polymerase requires to locate them. The most likely explanation is that a second protein binds to the DNA. We discovered that the F incD region has a three-fold excess conservation, which implies that three proteins bind there. We are investigating both anomalies experimentally. Thus the project has three major components: theory, computer analysis and genetic engineering experiments. The theoretical work can be divided into several levels. Level O is the study of genetic sequences bound by proteins or other macromolecules, briefly described above. The success of this theory suggested that other work of Shannon should also apply to molecular biology. Level 1 theory introduces the more general concept of the molecular machine, and the concept of a machine capacity equivalent to Shannon's channel capacity. In Level 2, the Second Law of Thermodynamics is connected to the capacity theorem, and the limits on the functioning of Maxwell's Demon become clear. Publications this year were mostly focused on Level O, but work continues at all levels.